What is better than SCHD stock?
The Schwab U.S. Dividend Equity ETF (NYSEARCA:SCHD) and the Invesco S&P 500 High Dividend Low Volatility ETF (NYSEARCA:SPHD) are two popular dividend ETFs from leading asset managers. With a dividend yield of 4.5%, SPHD's yield is higher than SCHD's dividend yield of 3.5%.
high yield for the VYM), the Schwab U.S. Dividend Equity ETF may be a better bet for investors that seek to invest for the long term and reinvest their dividends. The longer-term (10-year) performance comparison shows that the SCHD outperformed the VYM quite significantly on both a price and total return basis…
JEPI is a for higher yields and reduced volatility (gains and losses). SCHD is for moderate yields and market volatility. SCHD is a well-established bedrock dividend ETF. JEPI is newer and untested in market volatility.
SCHD - Volatility Comparison. VanEck Vectors Morningstar Wide Moat ETF (MOAT) has a higher volatility of 4.04% compared to Schwab US Dividend Equity ETF (SCHD) at 3.78%. This indicates that MOAT's price experiences larger fluctuations and is considered to be riskier than SCHD based on this measure.
SCHD provides broad diversification into quality dividend growth stocks without the need for individual stock picking. It has a reasonable portfolio weighted-average PE ratio, pays a meaningful yield, and is well-diversified across sectors, making it an attractive option for investors seeking income and growth.
SCHD's long-term track record of double-digit annualized returns over many years also inspires confidence that this is still a good place to be in the long term. Lastly, SCHD's expense ratio of just 0.06% is extremely favorable for investors, making this a compelling ETF to own in 2024 and beyond.
At a high level, we know that SCHD trailed the S&P 500 (SPY) by a wide margin, but it also lagged the broad dividend stock index by 6% as well. Yes, dividend stocks as a whole underperformed the market, but SCHD did especially bad.
One reason why JEPI is not a great choice for retirees is that its 0.35% expense ratio is rather high compared to many other passive income funds. For example, SCHD's expense ratio is only 0.06%. While over a single year, 0.29% does not seem like very much, throughout a long period that amount can add up.
However, JEPI may not be for beginners or long-term investors. For example, its hedge-fundlike qualities make the fund more complex than traditional ETFs and its performance will lag in up markets.
FTEC is managed by Fidelity, while SCHD is managed by Schwab. Both FTEC and SCHD are considered high-volume assets. They're less likely to be affected by issues like slippage and failed orders on Composer than low-volume assets. FTEC has more assets under management than SCHD by $40,840,123,247.
How high will SCHD go?
SCHD 12 Months Forecast
Based on 102 Wall Street analysts offering 12 month price targets to SCHD holdings in the last 3 months. The average price target is $86.34 with a high forecast of $99.20 and a low forecast of $70.92. The average price target represents a 10.79% change from the last price of $77.93.
SCHD - Performance Comparison. In the year-to-date period, SPY achieves a 7.81% return, which is significantly higher than SCHD's 1.68% return. Over the past 10 years, SPY has outperformed SCHD with an annualized return of 12.77%, while SCHD has yielded a comparatively lower 11.13% annualized return.
SCHD's long-term track record of double-digit annualized returns over many years also inspires confidence that this is still a good place to be in the long term. Lastly, SCHD's expense ratio of just 0.06% is extremely favorable for investors, making this a compelling ETF to own in 2024 and beyond.
Investors investing in taxable accounts argue that SCHD's dividends aren't taxed as harshly as the interest income from a Treasury. That is true, but a favorably taxed unrealized loss of over 2% does not compare well with a taxed gain over 4%.
SCHD Dividend Information
SCHD has a dividend yield of 3.48% and paid $2.67 per share in the past year. The dividend is paid every three months and the last ex-dividend date was Mar 20, 2024.
Schwab U.S. Dividend Equity ETF experienced a sharp drop after Oct. 19, 2023, due to selling pressure in its top holdings and a high correlation of daily returns. Several top holdings, including Amgen, AbbVie, Pepsi, Chevron, Cisco Systems, and Home Depot, saw declines in their share prices, especially last week.
Video Player is loading. In the last 10 Years, the Schwab US Dividend Equity ETF (SCHD) ETF obtained a 11.62% compound annual return, with a 14.51% standard deviation.
VIG vs SCHD: Who Should Invest
SCHD can be attractive to investors who prioritize generating income from their investments with above-average yields. Conservative investors may prefer VIG because it tends to have more stable returns in negative market environments compared to SCHD.
SCHD Signals & Forecast
The SCHWAB U.S. DIVIDEND EQUITY SCHWAB U.S. ETF holds sell signals from both short and long-term Moving Averages giving a more negative forecast for the stock. On corrections up, there will be some resistance from the lines at $78.85 and $78.79.
Performance Comparison of SCHD vs. VTI. The total return performance including dividends is crucial to consider when analyzing different investment funds. As of 1/15/2024, SCHD has a one year annualized return of 4.58%, while VTI has a five year annualized return of 26.03%.
Why is JEPI not good?
JEPI is not a bad ETF, but it and its peer group (covered call ETFs) are overrated by investors. And the cracks are starting to show. Extended down markets that don't immediately get back up are a risk to these ETFs not fully understood by many investors.
In 2023, SPYI generated total returns of 18.13% and price returns of 4.69%. JEPI's total returns were 9.81% with price returns of 0.90% over the same period. SPYI remains a consistent outperformer within the category and has a management fee of 0.68%.
According to analysts, JEPI is a good investment for investors who want to reduce the volatility of their portfolio without compromising returns. An ETF like JEPI, in moderate amounts, can be a good choice for sophisticated investors, retirees, and those following the FIRE movement.
The JEPI ETF's use of Equity-Linked Notes, or ELNs, resulted in higher tax rates for investors. The outlook for JEPI in 2024 is uncertain, with potential underperformance if the S&P 500 is led higher by the Magnificent Seven.
Their recent payouts were impressive: JEPI's 12-month yield was 11.7% at the end of 2022, compared with only 1.7% for the S&P 500 index. The majority of this yield came from selling one-month calls on the S&P 500 and paying out all the proceeds, or call premiums.
